KN Publisher challenges Parliamentary Order that gives abusive and extraordinary tax-free ride to oil companies

Jan 16, 2022 News

Kaieteur News – The latest legal case filed by Kaieteur News publisher, Glen Lall via his Attorney-at-Law Mohamed R. Ali, does not only challenge the onerous tax provisions of the Stabroek Block Production Sharing Agreement (PSA). It also challenges the validity of Order 10 of 2016 which was moved in the National Assembly by former Finance Minister, Winston Jordan. That Order allowed the affiliated companies and subcontractors of ExxonMobil and its partners, Hess Corporation and CNOOC Petroleum Guyana Limited, to enjoy an extraordinary tax free ride that is catered for in their contract.

Kaieteur News Publisher, Glenn Lall

Counsel for the Applicant is contending that the Order was made under the Petroleum Exploration and Production Act. Ali argues however that that piece of legislation is not a Tax Act or other subsidiary legislation made under such Act. Therefore, the said Order is ultra vires, unlawful, null, void and of no legal effect.
He further argues that sub-sections 1A and 1B of Section 6 of the Financial Administration (and Audit) Act specifically provide that except as provided in sub-sections (1C) and (1CC) of the Financial Administration (and Audit) Act, no remission, concession, or waiver is valid unless expressly provided for in a Tax Act or subsidiary legislation.
He said too that the Minister responsible for Petroleum at the time, Raphael Trotman exceeded the authority given to him under Section 10 of the Petroleum Exploration and Production Act, by entering into the Petroleum Agreement dated June 27, 2016, containing provisions violative of the Constitution of the Co-operative Republic of Guyana, the Petroleum Exploration and Production Act, Financial Administration (and Audit) Act and the Prevention of Discrimination Act.
The case notes as well that the Minister assigned responsibility for finance at the time, being Winston Jordan, violated Section 51 of the Petroleum Exploration and Production Act, and Financial Administration (and Audit) Act, when he purported to grant concessions via Order No. 10 of 2016 Petroleum (Exploration and Production) (Tax Laws) (Esso Exploration and Production Limited, CNOOC/Nexen Petroleum Guyana Limited and Hess Guyana Exploration Limited), made under the Petroleum (Exploration and Production), which is not a Tax Act.
For the foregoing reasons, Lall through his lawyer is seeking the reliefs to be granted in their entirety.
The matter is set to be heard on March 10, 2022 at 10:30hrs before the Honourable Justice Nareshwar Harnanan.

REASON FOR LEGAL CHALLENGE
Asked about the reason for his court challenge to the contract, Lall told this newspaper that when one takes into consideration, the extent to which the provisions of the contract create oppressive circumstances that hinder locals as well as the extent to which it breaches the laws, there is no way he could sit back and not take action.
What also incensed the KN Publisher is how costly these provisions are to the nation. Lall said, “When you take into account the cost of these provisions to the country, the enormous revenue Guyana is giving away and the impact it can have, and it will have, on the country and its citizens, it is unimaginable. It must therefore be challenged. For example, we gave away US$720M in 2020 alone in taxes to the oil companies and that was a figure from the Auditor General’s Report.”
The Publisher continued, “But even that is not entirely accurate, if we are to take into account what is being given away, when we look at the oil production figures. But let me give an example of what that US$720M could do for us. Had Guyana collected that, it could have increased the public service salary 10 times. It could have given us a bridge across the Demerara and Berbice Rivers and another from Parika to Leguan half way. And I don’t want to talk about the number of roads that US$720M could have repaired. These are the things that have been eating away at my soul that forced me into moving to the courts.”
Lall said he moved to the courts not just as the publisher of the newspaper who is passionate about his duty to the people but as a citizen, who refuses to sit idly by while the lion’s share of the oil wealth is given to foreign companies and Guyanese are relegated to eating the crumbs that fall from the table.
Lall, who said that the case was in the making for just over nine months, categorically states that he reposes the absolute confidence in the judiciary here to determine the case but noted, nonetheless, that he is prepared to go all the way to the Caribbean Court of Justice (CCJ) on the matter.